The SNP are preparing to rule Scotland as a minority government, after their potential allies the Green Party joined the Liberal Democrats in ruling out a full coalition.
Alex Salmond had been hoping to form a coalition government with the Liberal Democrats and Green party after winning a one seat lead over Labour in the Scottish election.
However, the Liberal Democrats declined to form a coalition, objecting to Mr Salmond's commitment to holding a referendum on Scottish independence.
The Greens have now indicated they will not formally enter a coalition government with the SNP, after the nationalists failed to meet their stringent environmental policies.
However, with just two members in the Scottish parliament a coalition with the Green party would still have seen the SNP fall short of the 65 MSPs needed to command an overall majority.
Robin Harper, co-convener of the Scottish Greens, said a formal coalition was not out of the question, but said the Greens are most likely to vote work with the SNP in a 'confidence and supply' model.
This means the two Green MSPs will vote with the 47 SNP MSPs on an issue by issue basis and support the nationalists in any no confidence motion. It allows them, however, to object to SNP proposals such as road widening.
Following talks over the bank holiday, Mr Harper said the two parties had enjoyed "constructive discussions", adding that it is the duty of all parties to secure a "stable and progressive" government for Scotland.
He continued: "Our top policy priority is to deliver the necessary effective action on climate change and transport. More discussion is required on these issues before any agreement can be reached and we are looking forward to engaging in those constructively.
"In addition, the clear preference of the Scottish Green party is for political cooperation short of formal coalition, based on a model of governance known as "confidence and supply", although we have not ruled out formal coalition."
Mr Salmond appeared undeterred by the prospect of minority government, describing it as an "exciting prospect" and an incentive to build consensus politics.
"The bulk of our preparation is assuming the responsibility of government as a minority [party]," he told the BBC. "There are advantages in minority government because it clarifies our purpose and it might enhance the parliamentary process. Every single vote is a challenge and the parliament must be light on its feet."
Mr Salmond has until May 31st to form a government and win parliament's backing to be named first minister and for his inaugural budget.
While rejecting a coalition with the SNP, the Liberal Democrats insisted they would not form a coalition with Labour, easing Mr Salmond's fears that a unionist-coalition would "freeze out" the SNP.
However, Labour and the Tories are likely to oppose Mr Salmond's appointment and any budget put forward.
Mr Salmond needs support from 65 MSPs to form a government. In the event that he is unable to obtain majority backing within 28 days of the election, a second election must be held.
Such a move would be deeply unwelcome for all involved. The Electoral Commission are still questioning why 100,000 ballot papers were rejected on Thursday, and legal action may be taken against proceedings in Glasgow.